As Australia starts to open borders, we expect to see increased business travel along with increased holidaying particularly as the weather improves and Christmas holidays beckon.
But is the Hotel, Tourism & Leisure industry ready for this influx – have they reassembled a suitable team? are they marketing to previous guests? are they leveraging off government and Brand promotional campaigns? do they have property specific campaigns? are they ‘on-market’ with their offering? have they developed Covid safe cleaning and hygiene protocols? These are just a few of the questions that need to be considered with clear implementation strategies developed to deal with the re-opening.
What will be the new ‘norm’? This is very hard to predict. With the potential of further outbreaks of Covid altering the potential market on a daily basis, this means that operators will need to be nimble. Furthermore, with many Brands having substantially reduced their teams, the level of assistance and mentoring available to GMs will be somewhat reduced. As such, owners need to be aware of this raised isolation and work with GMs to establish mentoring networks or bring in specialist asset managers to assist them through the transition.
Whilst it is always an easy strategy to reduce rates to win business, this simple approach can often lead to long term revenue pressure when you try to return to historical rates. As such it is important to have a clear strategy as to how and to whom this is delivered and what the offer includes as this is not just a simple chase for immediate revenue. Decisions need to also consider the impact on the underlying asset value.
As the international borders are opened, the rush to travel is likely to be slow with many travellers wanting to see sustained low levels of Covid before they are willing to pursue international travel, notwithstanding the strong performance (overall) that Australia has achieved in the battle against Covid. This will mean that accommodation usually focussed on international guests may take longer to recover and therefore need to refocus their attention in the shorter term to domestic markets.
In summary, the road to recovery is likely to have many potholes and bumps. It will be those that have a strong strategy and can communicate that to key stakeholders in a clear and concise manner that will get to the end of the road. Those that struggle to adapt may fall by the wayside.
